As it has for most of the past decade the Oak Park and River Forest High School board is poised to adopt a tax levy that is less than the maximum allowed by law. On Dec. 15 the school is expected to approve a 2022 tax levy that is 3.96% higher than last year’s levy. That’s about 1.5% less than allowed by law. The school board will host a public hearing on Dec. 15 before voting on the 2022 tax levy.
The state tax cap law limits the levy increase to inflation, as measured by the Consumer Price Index over the previous year, or 5%, whichever is less, plus the value of any new construction. Since the annual increase in CPI as of December 2021 was 7% school districts and local governments such as OPRF are limited to a 5% increase in the tax levy this year plus an amount to capture the value of new construction.
OPRF’s Community Finance Committee, which was created this year, recommended an increase in the base levy of 3 to 3.5% plus .46% for new property.
OPRF has, unusually for schools and other taxing bodies, been levying less than the maximum allowed by law since 2013 in an effort to reduce the massive cash reserves that it has accumulated since an operating rate tax increase was approved in a 2003 referendum. OPRF is projected to have a cash reserve of approximately $76 million in June 2023, the end of the current fiscal year. Since the 2013 tax year OPRF has collected $67 million less in property taxes than the maximum allowed by law.
“Our fund balance is still healthy enough that we can afford not to tax to the max,” said Tom Cofsky, president of the District 200 school board.
The 3.96% increase in the tax levy is estimated to cost the owner of a home assessed at $400,000 an additional $132.41 next year in property taxes. Approximately 80% of OPRF’s revenues come from local property taxes.
The dollar amount of the levy request is $77,805,794, a 3.96% increase over last year’s levy of $74,842,073. The Cook County Clerk’s office will set the precise amount of next year’s tax extension, the amount of property tax dollars OPRF can collect next year, once the exact value of new construction within the district is calculated.
OPRF’s 2022-23 budget forecasts expenditures to exceed revenues by $14.5 million due to costs associated with the Project 1 renovations done at the school.
Cofsky was asked whether it was wise for OPRF to tax less than the maximum allowed by law when a nearly $100 million Project 2 renovation of the physical education wing, including a new swimming pool and some theater upgrades, is on the horizon.
Cofsky said that, as a general matter, operating funds should not be used to pay for long term facilities improvements. Debt makes sense for long term capital improvements Cofsky said.
“We tax on what we need to run the school and then we’re going to put independent plans together for how to fund our major renovations,” Cofsky said. “And it also has to do with who’s paying for the facility. And again I’m going to be philosophical. It would be nice that the residents that are enjoying our facilities, those who live here in the next 10, 20, 30 years are the ones that ultimately pay for the renovations.”